Were you prudent with your investments last year? Did they help you save tax? Or did you end up paying more than you could afford?
What investment mistakes did you make last year? Are their ways to rectify them? What investment options should you go for this year? What should you do to bring your tax liability to the minimum level?
In an hour-long chat on
rediff.com on Thursday, direct tax expert
Vikas M Gandhi replied to many such readers' queries. Here is the transcript:
Vikas Gandhi says, Good evening friends and welcome back to tax chat session.
Vikas Gandhi says, There are limited tax saving options available and hence it is very difficult to suggest best tax saving options. these options always depends upon your risk bearing capacity and your liquidity requirement.
Vikas Gandhi says, By purchasing a second house, in my opinion, you won't be saving any taxes. Infact you will be paying additional tax on notional income, if neither of the property is given on rent.
Naresh asked, Hi. I have a house in Pune which I have rented out and have bought another house in Mumbai. How can I get the maximum tax benefit?
Vikas Gandhi answers, at 2008-06-05 16:10:54What tax benefit you are looking out for? You have two properties -one is given on rent and other is occupied by you. If you have purchased the property at Mumbai by taking a housing loan, you can claim deduction on account of interest payment upto Rs.1,50,000/-. In addition to this you will also be able to claim deduction on account of principal repayment of loan within overall limit of Rs.1,00,000/- u/s 80C.
Vicky asked, Hi Vikas, What is the last date for filing returns this year?
Vikas Gandhi answers, The last date for filing returns for the year ended on 31/03/2008 is 31st July, 2008. However if you are required to get your books audited under Income tax law, then the due date is 30/09/2008.
raja asked, Hi, I made a profit of Rs 1 lakh from stocks. Is it taxable?
Vikas Gandhi answers, If this is the only income, you had during the year, then the profit is not taxable. However if this profit is in addition to other income than you will have to pay tax, provided such profit is not a long term capital gain.
Ramanathan asked, How is tax on profits in shares calculated,is it for each share or on consoldated basis for all shares, if there is a loss will it be adjusted?
Vikas Gandhi answers, Profits have to be calculated on individual basis. This profit gets divided into either Long Term or Short Term Capital Gain. If the gaion is Long Term Capital Gain, and you have paid Securities Trnasaction tax on sale, your capital gain is exempt from tax otherwise the same is taxed @10% or 20%. In case of Short Term Capital Gain, if you have paid Securities transaction tax, such profit will be taxed @ 10%, otherwise the profit will be taxed at normal rate of tax. Before calculating tax, if you have any loss, the same gets adjusted first and then tax is calculated on balance gain. However bera in mind that Long Term Capital Loss cannot be adjusted against Short Term Capital Gain.
dhiru asked, Hi Vikas, LIC as compared to long-term FDs, which are the best tax saving options?
Vikas Gandhi answers, Compared to long-term FDs, in my view, LIC is a better option.
itsmebuddy asked, I am showing HRA to company as if i am paying Rent to my Father, is this OK. He dosent have anyother income, do he need to file tax
Vikas Gandhi answers, YOu can claim HRA benefit by paying rent to your father. However for this the house should be owned by your father and you should be actually paying rent to your father by a cheque. If the rent income of your father is more than the exemption limit of Rs,1,50,000/- (F.Y.2008-2009), then he has to file income tax return.
L asked, I left a company after working there fro 2.5 yrs. I got some money due to my leaves getting encashed while leaving.Is that taxable ? How do I fill up the Income tax return to show leaves encahsed (while resigning from the organisation) as non-taxable ?
Vikas Gandhi answers, First you need to find out how of your leave salary is exempt from tax. This amount has to be calcuated and is least of the following - a. Period of earned leave to the credit at the time of leaving the job * Average monthly salary b. Average monthly salary * 10 c. Rs.3,00,000/- d. Leave encashment actually received. While filing
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